The country had been filling supply gap in international markets left by Russia’s invasion of Ukraine.
India’s government sought to limit international concerns over its sudden ban on wheat exports, a move that is likely to push food prices higher and fuel hunger in poor countries that depend on imports of the commodity. A day after saying it was implementing a ban on overseas sales, New Delhi said on Sunday it would “ensure the fulfilment of the genuine needs” of those nations that are dependent on its wheat for food security.
On Saturday, it said it was introducing a ban “in order to manage the overall food security of the country and to support the needs of the neighbouring and other vulnerable countries”. It said it would still allow exports for which letters of credit had already been issued. That announcement, one of latest protectionist measures taken by food exporting countries following this year’s surge in prices, follows denials by Indian government officials that they would stop wheat exports. India had been filling the export supply gap in the international wheat markets left by Ukraine after the Russian invasion, but concerns had heightened about export restrictions amid a heatwave which has hit the country since March.
The U-turn came after Indian government data this week showed domestic inflation surging to the highest level in eight years, with rising food prices alarming policymakers. Traders predicted chaotic trading on the international wheat markets when they open at the start of next week as the ban would be a blow to buyers looking for wheat supplies. “It’s an absolute bombshell,” said Swithun Still, a grain trader based in Switzerland. “There will be panic on the wheat futures markets when they open,” he added.
This article first appeared in the ft
